Commercial Mortgage Rates – How Your Commercial Mortgage Broker Can Help You Secure Financing for Those Special Projects

Securing mortgage financing to purchase a regular home can be relatively easy – but how about when you want to secure funding for that special commercial project, be it a custom built home or a commercial property such as an apartment building or a retirement home? Once you have drawn up the plans and received the proper permits, securing financing at the best commercial mortgage rates requires the expertise of a professional commercial mortgage broker.

Not all mortgage brokerage firms employ a commercial mortgage broker, but those that do should have a large portfolio to help you secure mortgage financing at the most competitive commercial mortgage rates possible. Whether you are anxious to get stated on building your dream home from the bottom up, or are looking to expand your small business space, you will need the funding to accomplish these goals, and an experienced commercial mortgage broker can help you get it.

Why is it important to seek out the best commercial mortgage rates from a qualified commercial mortgage broker? Well, going directly to the bank won’t necessarily give you access to a variety of different lenders, thereby limiting the commercial mortgage rates that are available to you. By working with a commercial mortgage broker, one that routinely arranges commercial mortgages, you will have access to a wide range of banks and lenders, meaning that you can rely on your commercial mortgage broker to secure the best commercial mortgage rates out there.

Furthermore, by working with someone who is well versed in arranging commercial mortgages, you can be sure that all of the required protocols are followed, and that your expert commercial mortgage broker crosses all the T’s and dots all the I’s. They know what to expect when arranging commercial mortgage financing, rather than just residential mortgage financing.

Just like a traditional mortgage, commercial mortgages have terms (5 year term mortgage, 10 year term mortgage, etc.), and depending on the lender can be either fixed rate mortgages or variable rate mortgages. Commercial mortgage rates are really not that different from traditional mortgages, so don’t let the idea of them scare you – talk to your commercial mortgage broker and let them explain all of the fine print.

What types of projects are covered under commercial mortgages? There are several – big and small. Want to build an apartment building, condo or townhouse complex? A commercial mortgage broker can get you the money to do it. Thinking about building a retail space, such as a mall, or just adding on to your current retail location? Yes, that could be covered by a commercial mortgage. Restaurants, halls, nursing and retirement homes, hotels, bars, custom built homes, etc., are all covered by commercial mortgages and are the realm of the commercial mortgage broker. Even land development and land servicing are included.

Getting started on that new project – be it small or big – doesn’t have to be overwhelming, especially when it comes to commercial mortgage financing. Your mortgage broker can help your secure the best commercial mortgage rates and help get you started on that project right away.

For more information about commercial mortgage rates or to speak with a commercial mortgage broker, please contact Paul Mangion of The Mortgage Centre at 416-204-0156 or visit www.themortgagecentretoronto.com.

Ontario Mortgage News– Types of Mortgages Part 4: High Ratio Mortgage vs. a Conventional Mortgage

Are you getting ready to buy a home and obtain mortgage financing? Knowing your options before jumping in is important. This is part 4 of a 4 part series that gives you important Ontario mortgage news and information about the various types of mortgages available in Ontario. Getting a mortgage does not have to be stressful, and knowing what mortgage types are available to you can help keep the search for your perfect home stress-free.

This final Ontario mortgage news blog will look at the high ratio mortgage and the conventional mortgage. First, what is a high ratio mortgage? A high ratio mortgage is a mortgage where the borrower puts down less than 20% of the total purchase price of a home as a down payment. In Ontario, a minimum 5% down payment is required on all home purchases, but you can put down as much as you like. However, if you put down less than 20% you have to get a high ratio mortgage.

So what does this mean? Well, having a high ratio mortgage means that it is necessary to purchase mortgage insurance, usually done by your lender. The premium for this insurance is usually calculated in as a closing cost, or can sometimes be financed through the mortgage.

Why do you need mortgage insurance with a high ratio mortgage? A high ratio mortgage necessitates the purchase of mortgage insurance because the lender is putting forth more risk and wants to protect their investment. If you are putting down less than 20%, there is a higher chance that the lender will not recoup those funds if you default, and therefore the insurance is there for their protection.

So what if you put down more than 20%? This is where a conventional mortgage comes in. Since you have placed what the lender considers to be a large enough down payment on a home, you can qualify for a conventional mortgage and are not required to buy mortgage insurance.

If you are putting down more than 20%, there is more immediate equity in your home and the lender acknowledges that you are less of a risk. Since there is less risk involved on the lender’s behalf, they will often provide much more favourable repayment terms and you may find rates a little more flexible.

So what are the benefits of these two types of mortgages? Simply put, if you want to open the range of properties you can have access to and are willing to put down less as far as a down payment, then a high ratio mortgage might make sense – or if you only have that 5% to put down then you are not prohibited from buying at all. However, if you want to feel more comfortable and put down a larger down payment and skip the mortgage insurance, then a conventional mortgage may be right for you. It all depends on your current and future needs and goals, so talk to your mortgage broker and see what they say.

For other Ontario mortgage news or for more information about high ratio mortgages and conventional mortgages, please contact Paul Mangion of The Mortgage Centre at 416-204-0156 or visit www.themortgagecentretoronto.com.

Ontario Mortgage News– Types of Mortgages Part 3: Zero Down Mortgage

Are you getting ready to buy a home and obtain mortgage financing? Knowing your options before jumping in is important. This is part 3 of a 4 part series that gives you important Ontario mortgage news and information about the various types of mortgages available in Ontario. Getting a mortgage does not have to be stressful, and knowing what mortgage types are available to you can help keep the search for your perfect home stress-free.

This third Ontario mortgage news blog will focus on the zero down mortgage. So what is a zero down mortgage? As its name suggests, it is a mortgage that requires you to put no money down as a down payment on a house. In Ontario, according to Canadian Mortgage and Housing Corporation guidelines, a minimum 5% down payment is required for every house purchase in the province. But sometimes saving is easier said than done, and so a zero down mortgage can be the ideal option if you are ready to buy a house but are lacking the funds for that necessary 5% down payment.

How does a zero down mortgage work? A zero down mortgage is a mortgage that combines traditional mortgage financing with your down payment. This means that the interest is usually a bit higher (usually 1-2% above prime) to allow the bank to recoup its financing of your down payment. Furthermore, it is set for a period of no less than 5 years so that the bank can get back those down payment funds.

Are you asking yourself will I get approved for a zero down mortgage? Well, here are some things to keep in mind. Qualifying for a zero down mortgage means having a great credit score and pristine credit history. Since the bank is fronting the entire mortgage rather than just a portion of it, they want to make sure that they are protected – so if your credit is not great it is unlikely that you will get approved for a zero down mortgage.

What about flexibility? Well, a zero down mortgage offers less flexibility than say a variable rate mortgage or a fixed rate mortgage. Because you are relying on the bank to back you, they give far fewer options, such as setting the length of the mortgage or setting a variable versus a fixed rate. However, as far as giving you the chance to buy without a down payment, it is an important option.

If you are ready to buy a house but are without the required minimum 5% down payment, but do have good credit history, a zero down mortgage may be an option for you. Instead of stressing over where to find that down payment or having to wait until you have saved it all, speak to a mortgage broker about the benefits of qualifying for a zero down mortgage right now.

For more Ontario mortgage news or for more information about a zero down mortgage, please contact Paul Mangion of The Mortgage Centre at 416-204-0156 or visit www.themortgagecentretoronto.com.